Fed continues low interest rates

Federal Reserve governors decided to keep the federal funds rate between zero and 0.25 percent during their meeting on Wednesday. They also signaled they will stick with low rates as the economy emerges from its COVID-19 struggles. “We’re a long way from a full recovery,” Fed Chairman Jerome Powell said, pointing to high levels of unemployment due to the pandemic.

What else did Powell say? At a news conference, reporters asked whether the Fed should respond to speculative surges in some stock prices, such as that of electronics retailer GameStop. (The price of GameStop shares went from $18 to $380 in only a few weeks as small buyers worked to undermine moves by investment firms to short the stock.) Powell said Fed policies aren’t the right tools to deal with stock speculation.

Dig deeper: Read Rachel Lynn Aldrich’s report in The Sift about the recent uptick in job losses.